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persfin-digest      Wednesday, December 16 1998      Volume 05 : Number 074



In this issue of the Personal Finance Digest:

       persfin digest
       Re: bi-weekly loan payments
       Re: Homeless Sister Deductions?
       Re: bi-weekly loan payments
       Re: Treasury Direct
       Re: Can the brokerage vote my shares if I don't vote?
       re:  Rebate Credit Cards
       Re: insurance for disabled person
       Re: Treasury Direct
       Re: Homeless Sister
       Re: Property Tax Abatement Process
       Pay early on a house, or "invest"?
       Re: Cash back MC/visa?
       Re: Cash back MC/visa?
       (no subject)
       Roth IRA question and Request for year end tax tips.

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----------------------------------------------------------------------

Date: Tue, 08 Dec 1998 14:21:34 -0800
From: Jim Garcia <[e-mail]>
Subject: persfin digest

Subject: bi-weekly loan payments

I prefer the already mentioned (and simple) method of paying extra
principle each month. You'll control the amount (in case you have
a cash flow problem one month) and Quicken (and I'd bet MS Money)
handle a split of your mortgage payment pretty easily.
Jim Garcia    [e-mail]

- ------------------------------

>  "L. Chen"  <[e-mail]> wrote
>Subject: Suggestion for a good investment book for a teenager

>What is a good investment book for boys in high school --
>with no experience in investment?         TIA       Chen

Check out "The Wealthy Barber" by David Chilton.
It's not a how to trade book, but a why invest, why start early,
how to get wealthy over a period of time book. It's written more
as a novel than a how to.
Or check you local PBS programming during their next pledge
drive. They'll probably have Chilton's show (same name) during
their fund raising (along with Suze Orman's so-so show "9 Steps to
Financial Freedom and Jonathan Pond's boring "Finding Financial
Freedom" & "Your Financial Future".
Jim Garcia    [e-mail]


- -

------------------------------

Date: Tue, 08 Dec 1998 16:56:28 -0600
From: Bill La Mar <[e-mail]>
Subject: Re: bi-weekly loan payments

[e-mail] wrote:

> Bill La Mar writes:
>
> << An even faster way to own your own home is to invest the extra dollars
>  each month into an investment such as Vanguard 500 index fund.Because of
>  the magic of compounding it will build up much faster than the increased
>  equity in the home. Besides if a person loses a job the equity in the
>  home is worthless until such time as the home is sold. If you can get
>  mortgage money for 5% after tax and invest money for 10% after tax you
>  are using one of the keys to financial security that has worked forever.
>  This is successfully using the financial perpetual motion machine.
>  People who have used the nine Keys to Financial Security have
>  consistently become wealthy.
>   >>
>
> Your example sounds great.  Instead of paying off a debt at 5% net, invest at
> 10% net. Good in theory.

What is the problem with the practice of IF you are making more than you are
paying for borrowing the money. If you have a 30 year $100,000, 7.5% mortgage; the
principal and interest payment is $699.21. If you pay an additional $58.27 per
month and the mortgage company receives the payment by the first of the month (no
15 day grace period) the mortgage will be paid in 280 months. If the payments of
$699.21 are made using the normal 15 day grace period after 280 months the balloon
to pay of the mortgage is $43,916.86. You also find that if you have been
investing the $58.27 every month at 10% net per year you have $64,421.22 available
to pay off the mortgage. If the mortgage is paid off and $657.48 is added to the
investment for 80 months you will have $114,176.89. If you continue making the
mortgage payments of 699.21 and add $0 to your investments for 80 months you have
an investment balance of $125,129.26. If  you continue making the monthly
investment of $58.27 the balance is $131,718.63. BTW 7.5% mortgage is
approximately 5% after tax for most of us.

> Your plan though will force people to overpay for
> their homes. A 100,000.00 house with a 30 year loan could easily end up
> costing 300,000.00.  Many people are finding out that they cannot sell their
> homes for enough to compensate them for the money they spent in interest,
> nevertheless make a profit.
>
> A better plan might be to prepay on the house and get the debt paid off.  THEN
> invest the money you no longer have to spend to the bank.

The figures above do not show though do they? The above figures will be even more
dramatic if each year when you figure your tax you add the amount to the
investment that the tax man lets you keep because of the mortgage. The first year
tax savings alone will increase the investment $22,264.60 at the 280th month and
$43,245.89 at the end of 360 months.

> Results:
> 1). You are much more likely to profit from your home if you reduce the
> interest paid.

> 2). You are in a better position financially and cash flow wise without a
> mortgage.
> 3). Prepayments produce savings that are guarranteed and tax free.

I have heard this many times, but have never been able to see it work in practice
or even on paper when the options are examined.

The slow growth in the early years of any investment can't offset the high

> cost of interest in the early years of a mortgage.  You get more bang for your
> buck prepaying a mortgage loan.

Sounds good. Show me in figures how it works.

> Frankly, I'd rather not have the risk of
> forclosure when the balance of my investments can't pay off the balance.  I'll
> stick with prepayments, as i've already saved $110.000.00 in six years time.
>

I do not understand how prepayments can hold off the threat of foreclosure until
you have paid off the mortgage. While money in a seperate investment account can
certainly hold off the time of foreclosure.

BTW if you will also get a new 30 year comparable mortgage about every 10 years
and continue making the $657.48 mortgage and investment payments you can increase
the financial bang for your buck. You continue getting a better tax break on the
payments that you are making.

Bill La Mar




- -

------------------------------

Date: Tue, 8 Dec 1998 18:34:07 -0500
From: Rich Carreiro <[e-mail]>
Subject: Re: Homeless Sister Deductions?

>business for which she receives no monetary compensation. Since I can
>recieve up to $10K deduction for gifts to relatives,

There is no such thing as a "$10K deduction for gifts to relatives."

What you may be thinking of is that gifts of under $10K per year per
person (to ANY person, not just relatives) have no GIFT TAX consequences.

The gift tax is an entirely separate creature from the income tax.

Rich Carreiro
[e-mail]
P5-100/RedHat Linux 4.2

- -

------------------------------

Date: Tue, 8 Dec 1998 18:49:38 -0500
From: Rich Carreiro <[e-mail]>
Subject: Re: bi-weekly loan payments

>The slow growth in the early years of any investment can't offset the high
>cost of interest in the early years of a mortgage.  You get more bang for your
>buck prepaying a mortgage loan.

I disagree.  The interest isn't a "higher cost" earlier in the mortgage,
there's just more of it because the initial balance is high.  Similarly,
the investment doesn't grow any more slowly at the beginning, there's
just less earnings because the initial balance is low.

If your mortgage is at 6.5% and you prepay $100, you have a rate of return
of 6.5% on that $100.  If you invest $100 at an after-tax rate of 9%, you
have earned 9% on that $100.

If your mortgage was at 6.5% and you could get a *guaranteed* rate of
return of 9% on your investments, you would be irrational if you did
anything but pay your mortgage off as slowly as possible so that you could
capture the 3.5% spread for as long as possible.

However, unless we get a huge spike in long-term interest rates, you're
not going to get a guaranteed return of 9% anywhere, which leads to...

>Frankly, I'd rather not have the risk of forclosure when the balance of
>my investments can't pay off the balance.  I'll

Now this is an eminently valid point and a legit argument for prepayment,
unlike the first paragraph.

Rich Carreiro
[e-mail]
P5-100/RedHat Linux 4.2

- -

------------------------------

Date: Tue, 8 Dec 1998 18:42:53 -0500
From: Rich Carreiro <[e-mail]>
Subject: Re: Treasury Direct

>I just received information on the new Treasury Direct program.  Could someone
>give a quick explanation of the benefits of T-Bills/Notes/Bonds versus CDs?  I
>live in IL, so our state tax is only 3%.

Bills, notes, and bonds are direct obligations of the US govt.  As such,
interest income from them are exempt from state and local income tax,
and their value is exempt from state and local intangibles taxes.

T-Bills are short-term debt instruments issued in 13, 26, and 52 week
maturities.  They pay no interest.  Instead, they are issued at a discount
and are redeemed at par.  The difference between issue price and redemption
price is your interest.  You are considered to receive the income when the
bill matures or when you sell it.

T-Notes/T-Bonds are your standard interest-bearing bonds.  The term "note"
tends to be applied to intermediate maturity instruments and "bond" to long
term instruments (like the famed 30-year bond), but aside from that there are
no differences between them.  They pay half the stated interest payment twice
a year, like most bonds of all sorts do.

There is absolutely no default risk since they are direct obligations
of the US.  There is still the standard inflation and interest-rate risk
of all fixed-income instruments.

Unlike most CDs, Treasury securities are negotiable and there are very
liquid markets for them.

Rich Carreiro
[e-mail]
P5-100/RedHat Linux 4.2

- -

------------------------------

Date: Tue, 8 Dec 1998 20:56:18 -0700
From: [e-mail]
Subject: Re: Can the brokerage vote my shares if I don't vote?

>From: "L. Chen" <[e-mail]>
>Subject: Can the brokerage vote my shares if I don't vote?
>
>One of the Waterhouse Securities' customer rep. told me this:  For
securities
>registered in "street name", if I don't vote my shares, THEORETICALLY
(under
>SEC rules) the brokerage house can vote my shares.
>
>Does any one know whether this is true or false?

Dunno.  All the proxy ballots I've ever gotten require a signature.

I suppose if what you say is the case, your broker would have
notified you of this somewhere in the account agreement, probably
using a 3 point font.

To play devil's advocate and throw a wrench into the works,
what happens if the co-owners of shares held in JTWROS
don't agree on how to vote?

Do they each get 1/2 vote?

If one votes shares without consent of the other, does the
neglected dejected owner have recourse?

Wondering, as I usually do...

J.



- -

------------------------------

Date: Wed, 9 Dec 1998 00:28:20 EST
From: [e-mail]
Subject: re:  Rebate Credit Cards

>  Date: Tue, 8 Dec 1998 00:03:36 -0500
>  From: Mike Machnik <[e-mail]>
>  Subject: Cash back MC/visa?
>
>What good cash back (specifically) cards are
>  out there?  I know of GE Rewards, which has a $25 fee if you pay in full.

Discover pays me .25% up to $1K, .5% from $1K to $2K, .75% from $2-3K, and 1%
above $3K.Just today I got an offer for a 'deluxe' Discover.   For an $18 fee,
you get the same thing up $10K, then 2% above that.  It also offers a lot of
"Gold Card" type features like rental car insurance, etc.

I buy all my gas, groceries, plane tix, etc. with my Discover.  In a typical
year I spend $5K and get somewhere around $50 back.  NOTE:  If you pay any
finance charges (at 19%), you QUICKLY lose the advantage of cash-back. Many
restaurants don't take Discover. (800-347-2683)

I have received offers from Capital One Visa and Shell MasterCard.  Capital
One Platinum pays you .5%  up to $3K, then 1% above that and only charges 10%
interest and no annual fee.  (No 1-800 number given).

Shell MC pays 1% on most purchases, and 5% on Shell Gas purchases BUT THE
REFUND IS PAYABLE IN SHELL GAS, not cash.  Interestingly, in my home town, the
Shell Station is usually 5% more expensive than the generic stations!!  They
charge 9.9% and waive the $20 annual fee if you buy a certain amount of Shell
gas. (For an application, 800-free-gas)

Interesting note:  Once or twice I've been late with a payment to Discover (I
always pay in full, I was just on vacation or lost the statement).  Each time,
Discover graciously credited me for all late fees and finance charges after
one phone call, thereby saving my cash-back bonus.  On the other hand, I was a
week late on one payment to Capital One and they said 'tough luck'.  That $20
late fee and $15 finance charge would have wiped out a modest cash-back
amount.

Good luck,
Scott

- -

------------------------------

Date: Wed, 9 Dec 1998 08:56:16 EST
From: [e-mail]
Subject: Re: insurance for disabled person

Hi
My 45 year old brother has recently been diagnosed with Asperger's Syndrome.
This is a developmental disorder that he has had since birth.  He has always
worked on the family farm but now it is being sold to pay estate taxes.  He is
living with me and I am trying to get him some help and benefits since he
finally has a diagnosis and is considered disabled.  I am most concerned about
medical insurance.  Although he is quite odd I am pretty sure I can get him
some work.  He has private insurance that my Mom paid for and it is quite
expensive.  Even if we get him a job with benefits we are afraid to let the
insurance lapse since he has some preexisting conditions.  He will only be
living with me for a year so any job I get him will be temporary.  I also
worry that his disability may make it hard to keep a job long term.  Any
advice would be appreciated.  TIA

- -

------------------------------

Date: Wed, 9 Dec 1998 09:36:03 -0500
From: [e-mail]
Subject: Re: Treasury Direct

Rich,

Sorry to butt in like this. But there IS a slight (technical) difference
between Bills (on the one hand) and Notes and Bonds (n the other hand).
Bills are sold 'discounted'. i.e., you pay might pay (say) $995 for a Bill
that matures in 6 months and will pay you $1000 (the face value) on
maturity. The difference between the two is the interest earned ($5 in this
case). When you purchase Notes and Bonds, OTOH, you pay the FULL face value
(say $1000) and get 'coupons' that pay interestevery six months. Upon
maturity, you receive the $1000 back.

Seshadri Narasimhan

>I just received information on the new Treasury Direct program.  Could
someone
>give a quick explanation of the benefits of T-Bills/Notes/Bonds versus
CDs?  I
>live in IL, so our state tax is only 3%.

Bills, notes, and bonds are direct obligations of the US govt.  As such,
interest income from them are exempt from state and local income tax,
and their value is exempt from state and local intangibles taxes.

T-Bills are short-term debt instruments issued in 13, 26, and 52 week
maturities.  They pay no interest.  Instead, they are issued at a discount
and are redeemed at par.  The difference between issue price and redemption
price is your interest.  You are considered to receive the income when the
bill matures or when you sell it.

T-Notes/T-Bonds are your standard interest-bearing bonds.  The term "note"
tends to be applied to intermediate maturity instruments and "bond" to long
term instruments (like the famed 30-year bond), but aside from that there
are
no differences between them.  They pay half the stated interest payment
twice
a year, like most bonds of all sorts do.

There is absolutely no default risk since they are direct obligations
of the US.  There is still the standard inflation and interest-rate risk
of all fixed-income instruments.

Unlike most CDs, Treasury securities are negotiable and there are very
liquid markets for them.

Rich Carreiro
[e-mail]
P5-100/RedHat Linux 4.2

- -




- -

------------------------------

Date: Wed, 9 Dec 1998 06:12:55 -0800
From: Avrum Lapin <[e-mail]>
Subject: Re: Homeless Sister

At 12:57 PM -0700 12/8/98, persfin-digest wrote:
>Date: Sun, 06 Dec 1998 12:58:37 GMT
>From: [e-mail] (JMetz)
>Subject: Homeless Sister Deductions?
>
>I allow my homeless sister to live on my property in a trailer. Since
>I contribute more than half of her living expenses I claim her as an
>exemption on my income taxes. She also helps me in my home-based
>business for which she receives no monetary compensation. Since I can
>recieve up to $10K deduction for gifts to relatives, would the IRS
>allow that in lieu of my actually paying her for her help in my
>business? What I'm really trying to get is the exemption and deduction
>together.  Is that possible? Thanks.
>
$10K deduction for gifts to relatives. I think not.  What you can do is
give up to $10K to each of a number of individuals per annum without
triggering the need to file for gift tax (and thus reduce the $625,000
estate tax exemption)

Works without pay?  You are open to a law suit for back wages should she
ever get PO'ed at you (or falls under the influence of of someone who sees
you as a target).   To do this properly she should be paid wages, have FICA
etc taken out and submitted and then you can charge her rent for the
trailer.  Not sure where she gets her food money but if it is welfare or
SSI disability she had better declare her assitance from you or she could
be prosecuted.

Since you provide over half her support, she is your dependent. You can
also claim medical expenses.  If not married you can file as head of
household (if you can make the trailer part of your house).  If your income
is low enough and the sister meets the definition of disabled you might be
able to claim EIC.

If you make a loan to her (set it up properly) and she defaults you might
be able to deduct the bad loan if you go through an appropriate collection
process. (but be prepared for an audit).

In my opinion she is not homeless - she has a roof over her head. I am not
sure if she has a real mental problem or she is what I describe as a
professional victim.


Avrum Lapin
Upland., CA



- -

------------------------------

Date: Wed, 9 Dec 1998 07:21:16 -0800
From: Avrum Lapin <[e-mail]>
Subject: Re: Property Tax Abatement Process

At 12:57 PM -0700 12/8/98, persfin-digest wrote:
>Date: 08 Dec 98 14:56:48 EST
>From: [e-mail] (Jacqueline D. Richardson)
>Subject: Property Tax Abatement Process Help Needed
>
>Just received my property tax bill and noticed that the assessment has
>increased by $12,500.  I called the Tax Assessor to find out why since we
>hadn't been notified and apparently when we bought the property in July they
>noticed an error in the land valuation and corrected it.
>

    Property assessment for tax purposes is supposed to have some
relationship to the real value (i.e the selling price) of the property.
The relationship varies by state and sometimes within a state. Land may be
treated differently than improvements and residential property might be
treated differently than commercial.

    In general the tax assessor establishes a general value on property
and then makes adjustments for such things as extra bathrooms, finished
basements etc.

    In the normal course of events the assessment process is fairly
rigorous (I did not say fair) and theres is a defined process for notifying
one of a changes in assessment and appealing the new assessment.  In many
states assessment is a percentage of the fair market value and your appeal
will be challenged by "well will you accept the assessed value for the
property".

    SInce assessmements are published and publically available the best
way of appealling a reassessment is to compare the fair market value of
your property with similar properties and see if the assessments track.  An
experienced real estate lawyer or real estate appraiser can help here but
get a fee agreeed to in advance

    Here in California since Prop 13 properties are only formally
reassessed upon sale and then at the recorded sale price.  There is an
automatic upward reassessment of not more than 2% annually.  You can force
a downward reassessment if you can show that the neighbouring properties
are selling below assessed value (it has happened).  Last time I looked
(before Prop 13) the assessor had a book with each property listed and
notes such as "covered patio", "pool" etc.   To protect us against greedy
politicans and monument building administrators California requires a
plebesite on all tax increases.

Avrum Lapin
Upland., CA



- -

------------------------------

Date: Wed, 9 Dec 1998 11:39:39 -0800 (PST)
From: "J.D. Baldwin" <[e-mail]>
Subject: Pay early on a house, or "invest"?

> Your example sounds great.  Instead of paying off a debt at 5% net,
> invest at 10% net. Good in theory. Your plan though will force
> people to overpay for their homes.

It doesn't matter that you "overpay" for your home if the benefit
of doing so is a net "win" for you because that money was invested
elsewhere and made you that much more money.

That said, you are right to be skeptical.  In general, I think the
average person is a lot better off paying extra principal with his
house payment every month.  If you have extra money after *that* to
invest, great.  If you don't, then you probably aren't in a situation
where you'd benefit from putting money elsewhere.

There are several reasons for this:

1. The PMI scam.  (I really, really hate PMI.)  PMI isn't deductible,
and it goes away when you reach 20% equity in your home.  Thus, you
get a higher effective return on extra principal paid than you
mortgage rate alone would lead you to believe.

2. Confidence of ROI.  "Invest at 10%" sounds great.  I am still
waiting for someone to show me the investment where I get a 10%
GUARANTEED return.  Because of the nature of a loan repayment, paying
extra principal *guarantees* that I will get a significant positive
ROI on that money over time -- for me it's about 7.5% right now.  That
counts for a lot.

3. Liquidity.  Well, sort of.  When it comes time to sell a house,
it's usually because one is buying another house.  The extra principal
built up in one's current house will come in mighty handy then, and
might well make a significant difference in the amount of house one
can afford next time around.  In that hypothetical other "investment,"
your money may or may not be available to you.
- --
 From the catapult of J.D. Baldwin  |+| "If anyone disagrees with anything I
   _,_    Finger [e-mail] |+| say, I am quite prepared not only to
 _|70|___:::)=}-  for PGP public    |+| retract it, but also to deny under
 \      /         key information.  |+| oath that I ever said it." --T. Lehrer
***~~~~-----------------------------------------------------------------------

- -

------------------------------

Date: Wed, 09 Dec 1998 22:54:25 -0500
From: The Varshavsky Family <[e-mail]>
Subject: Re: Cash back MC/visa?

>What good cash back (specifically) cards are out there?

I currently have:

CashReward Visa (Chevy Chase Bank) - 1% cash back on all purchases
Gulf MC (Fleet Bank) - 1% back on all purchases toward purchase of Gulf
gasoline
   (Exxon had similar card, and if you buy their gas anyway, it's as
good as cash)
Bell Atlantic (Chase Manhattan Bank) - 1% back from all purchases
                                                           2% back from
your BellAtl. bill
                                                           3% back from
BellAtl. calling card charges
                                                           They send you
a cash certificate when you earn $20+
Chase Manhattan Bank MC with Retail Reward program - 5% back from
purchases you make
at one choosen retailer (we frequent WalMart and it was on the list -
bingo!) This program costs
$25/year, but we easily beat this by our charges, YMMV
(BTW, I've learned about this card on persfin!)

All these cards are rent free, gold/platinum (it this matters anymore,
which I doubt. I just wonder
what will be the next metal to be used after gold-platinum-titanium...
Uranium?)  If you care about
interest rate, check for yourself, since I have no idea (never ever paid
a finance charge, sorry :)

A year ago I got a Private Issue card (a.k.a. "Discover Gold Card"),
which tops cashback at 2%,
and it was the best choice then, but in 2 months they "adjusted" the
scale, so 2% is reached at $12,000
(not $5,000 as before - what a smart move! :)   and it doesn't make
sense for us anymore. Case closed.

Good luck,
- -Boris
Dover, NH




- -

------------------------------

Date: Thu, 10 Dec 1998 08:12:03 -0500
From: [e-mail]
Subject: Re: Cash back MC/visa?

Hi!

Do you have a phone number for the Bell Atlantic - Chase Manhattan Bank?
Would it be the same number for the Chase MC - One retailer program? I plan
to use it for K-Mart.

Thanks

Bell Atlantic (Chase Manhattan Bank) - 1% back from all purchases
                                                           2% back from
your BellAtl. bill
                                                           3% back from
BellAtl. calling card charges
                                                           They send you
a cash certificate when you earn $20+
Chase Manhattan Bank MC with Retail Reward program - 5% back from
purchases you make
at one choosen retailer (we frequent WalMart and it was on the list -
bingo!) This program costs
$25/year, but we easily beat this by our charges, YMMV
(BTW, I've learned about this card on persfin!)



- -

------------------------------

Date: Wed, 9 Dec 1998 22:28:39 EST
From: [e-mail]
Subject: (no subject)

Doug Hewko writes:

>>Not true! I pay my mortgage to my trust company in biweekly payments without
any fees! <<

Every solicitation that I have seen from banks offering conversion of monthly
loans to a bi-weekly schedule requires a substantial fee of hundreds of
dollars. Some require transfer fees as well.  Each "Mortgage Consultant" I
have investigated offers an escrow scheme costing hundreds of dollars plus
transfer fees.  Either you have a true bi-weekly loan to begin with or your
lender is simply collecting two of your half payments to make one normal
monthly payment.  Request an amortization schedule from your lender for the
last year and see how many times principle was deducted from the outstanding
balance.

>>
 All banks and trust companies will handle bi-weekly payments without
fees....you could even make weekly payments if you wanted!!! <<

Your lender may accept your 1/2 payments every two weeks, but that does'nt
magically change your amortization from monthly to bi-weekly.  Only a change
to your mortgage contract can do that.  Your lender is required by law to
abide by the terms of your mortgage contract.  If it was created as a monthly
loan, paying 1/2 your payment every two weeks will not change it to a
biweekly. Most likely, your lender is simply making a prepayment with the two
excess payments they get per year.  Better check with your lender to see what
they do with undesignated payments.  Many contracts state that undesignated
payments get applied to interest, late fees or escrow balances, not principle.

>> And Quicken 98 handles bi-weekly payments, although I still have to make
 adjustments to the interest paid every 6 months when I get my statement.
 Quicken uses the wrong interest calculation......but in 6 months it is off
 by about $10 in my principle, so it's not a big problem for the short run.<<

In my opinion, having written amortization software for windows, most programs
contain flaws which introduce subtle errors into the calculations.  There are
at least two common errors I find in the majority of programs and web sites
that try to do mortgages.  These errors render the program useless for
auditing purposes.  Many are close, very few are exact.  When it comes to
mortgages, a miss is as good as a mile.  Bad software is a BIG problem. A $10
error in six months is a HUGE error for any amortization program.  While I
don't care for quickens' mortgage module, I have not seen an error of that
magnitude in quicken. But then again, I refuse to use quicken for mortgages.
Though, to be fair, quicken does do a good job with my checkbook.  I find it
intriuging that you compensate every six months...

Those of us who prepay need to ensure that the lender has correctly applied
the prepayments and follows through on the new amortization.  I have
personally caught my lender making six mistakes on my fixed rate loan that
would have cost me $6,000.00.  I was able to tell tham what they did wrong and
what they needed to do to fix it. To the penny.  Bad software compounds the
problem.  Since companies that audit mortgages report an error rate of about
33%, accuracy is essential for those who want to audit their loans and ensure
maximum savings from their prepayments.

>> The only suckers out there are those who don't take advantage of weekly or
 bi-weekly payments. >>

The only "suckers" are those who think they will get something for nothing.
Believe it or not, there are those who KNOW that true biweeklies offer no
significant advantage over a monthly loan. An advantage that is less than 1%.
There are those who KNOW that pseudo bi-weekly escrow "scams" can cause you to
forfeit thousands you could have otherwise saved yourself.

[e-mail]



- -

------------------------------

Date: Wed, 16 Dec 1998 08:24:11 -0500 (EST)
From: Somesh Rao <[e-mail]>
Subject: Roth IRA question and Request for year end tax tips.

Any year end tax saving tips from this group?

One quick question about Roth IRA conversions. If my wife and I
have an AGI greater than 100k but individually our AGI is
less than 100k can we make the conversion from a regular IRA to a
Roth IRA?

Thanks

Somesh


- -

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End of persfin-digest V5 #74
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